TOKYO (AP) — Asian shares retreated Tuesday in quiet trading as investors awaited signs of what might be ahead for U.S. interest rates.

Japan’s benchmark Nikkei 225 was flat at 21,526.22, while Australia’s S&P/ASX 200 dipped 0.3% to 6,653.60. South Korea’s Kospi was marginally lower, down 0.1% at 2,063.14. Hong Kong’s Hang Seng fell 0.4% to 28,221.67, while the Shanghai Composite lost 0.2% to 2,927.34.

Shares fell on Wall Street overnight amid growing speculation an unexpectedly strong pickup in U.S. employment growth last month lead the Federal Reserve to hold back on aggressively cutting its benchmark interest rate. Many investors still expect a cut of a quarter percentage point, but fewer are now expecting a half-point reduction.

The market rallied through much of June after the Federal Reserve signaled that it’s prepared to cut interest rates to offset slowing global growth and the fallout from U.S. trade conflicts.

The S&P 500 fell 0.5% to 2,975.95. The Dow Jones Industrial Average slid 0.4% to 26,806.14. The Nasdaq composite lost 0.8% to 8,098.38. The Russell 2000 index of smaller company stocks dropped 0.9% to 1,561.39.

Investors will be listening closely for any hints on the central bank’s interest rate policy on Wednesday and Thursday, when Powell delivers the Fed’s semi-annual monetary report to Congress.

“After getting accustomed to trading the bad news is good news regime, investors are still struggling with the good news is the bad direction,” Stephen Innes, managing partner at Vanguard Markets in Singapore said in a commentary.

“They shouldn’t be as on the macro level; there is still no sign of a turnaround for eurozone activity data or China for that matter,” Innes said. “Suggesting downside global growth momentum remains the path of least resistance and if this doesn’t trigger a deluge of central bank easing, not sure what will.”